HOUSTON ― Chesapeake Energy Corp. is still buying acreage in Ohio’s Utica shale formation, CEO Aubrey McClendon said on Wednesday, but is facing increased competition there from companies such as Exxon Mobil and Hess Corp.
Chesapeake is the most aggressive buyer of land in the new U.S. shale formations, which are believed to hold massive reserves of natural gas and oil.
“Right now there’s still acreage to be acquired,” McClendon told reporters at the Jefferies & Co energy conference.
Chesapeake’s huge appetite for new property has left the company too debt-laden to pay for drilling, and forced it attract joint venture partners to help pay development costs.
McClendon earlier told the conference that the company still expected to close a joint venture worth $3.4 billion with a major international energy company by the end of 2011.
The company is expected to make an announcement later on Wednesday about a $750 million preferred share sale that it first announced on Nov. 3.
That sale of preferred shares is for its newly formed entity, CHK Utica LLC, which owns about 700,000 acres of leaseholds in the Utica shale.
Chesapeake will end its major acreage purchases next year, McClendon said, and is not interested in selling of its assets outright.
Shares in Chesapeake were up 4.3 percent to $24.80 on the New York Stock Exchange, lagging the gain of about 5.3 percent in the CBOE’s oil companies index.